Rogers Communication Inc. on the move

Rogers' management had prepared the market for relatively flat EBITDA (Earnings before infome taxes, depreciation and amortization) expectations in 1995, which at a consolidated $731 million ended up being slightly above our forecast. We are forecasting a 12.8% growth rate for EBITDA in 1996 to $824.4 million and a 14.5% growth rate in 1997 to $943.6 million.

Cable revenues and EBITDA should grow 6% and 7%, respectively, in 1996. By 1997 however, we would expect more substantial gains to evolve from the roll-out of expanded pay-perview channels, the Sega games channel, PC access services and the continuing expansion of other operations, including RNS. Our 1996 and 1997 estimated cable EBITDA is $474 million and $406.5 million, respectively.

                        Rogers Communications Inc.

Recommendation                                BUY

Symbol                                  RCI.B (1)

Price (12/2/96)                            $14.75

52-Week Price Range                 $11.50-$18.88

6-12 Month Target Price                    $20.00


                             1995A 1996E 1997E

Earnings/Share            (1.01) (0.83) (0.49)

Cash Flow                       1.63 2.10 2.65

  Per Share

P/CF Multiple                                 5.5

Shares Outstanding (min)                    177.5

Indicated Dividend                            0.0

Yield                                          0%

Year end                                     Dec.

(1) Non-voting shares

Cellular's growth rates should continue to improve in 1996 and 1997 as cellular penetration levels continue to expand. Our 1996 and 1997 cellular EBITDA is $384 million and $444.8 million respectively.

Multimedia will likely have a modestly better year in 1996. Still affected by rising paper prices, however, we believe 1997 results will be significantly improved. Our estimated multimedia EBITDA is $74.6 million in 1996 and $100.7 million in 1997.

We are maintaining our estimated year-ahead target price of $20 per share. The stock remains a Buy.

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